Let’s face it: The state of online travel is pretty sucky. As a broad category, it’s more solidly rooted in a Web 1.0 experience than nearly any other category of the Internet.

Even eBay’s UI is more evolved. Compared to online travel, online media is downright futuristic. At least other Web dinos like PayPal, Yahoo, and AOL get that they have a problem. Travelocity, Expedia, and Orbitz are still happy facilitating bookings online they way they did 10 years ago. The UIs are universally awful, and they still treat online travel as if price and endless inventory are the only two things that matter.

TripAdvisor? Oh wow. User-generated reviews. Wake me up when we evolve past CitySearch. Kayak? Okay, we can now look across all the many fragmented sites with pretty much the same inventory and wade through more matrices.

And yet, as disappointing to users as they’ve been, these “innovations” like meta-search and user generated reviews have actually yielded $1 billion-plus exits. That should show you just how big, lucrative, and broken online travel is.

Imagine if something actually delighted users?

So many online travel 2.0 companies have tried to do just that. Many got bought before they could do much. Arguably, you could lump Kayak into that. And the whole wave of social travel companies? Great idea, but as we’ve reported before: Woof. Most of them are dying, dead, or barely clinging to their pre-Series A ambition.

Just when we thought we were doomed to a world of Web 1.0 online travel agencies, it seems as if one online travel company may just have the chops — or at least the ambition — to aim for an IPO. It’s a surprising one. Are you ready? It’s Hotel Tonight.

The company is announcing today its Series D round of funding, and it’s a whopper: $45 million, bringing the funding to date to more than $80 million. “Now we have the resources to go where I want to go,” says co-founder and CEO Sam Shank.

I should hope so. That’s a large chunk of money for a mobile-only app the exact strength of which is that it really focuses on doing one thing well and limiting its inventory to a handful of listings.

When I first wrote about Hotel Tonight way back in December of 2010, I flagged how much time and money it would take to become geographically universal and mainstream. It’s still trying, but the money part, at least, hasn’t proven much of a challenge for Shank.

He was on a family “vacation” in Paris when he got the news that the funding deal was done. Like most entrepreneurs, the idea of time off with the family became overrun with work. He and his wife had just taken the kids to the Louvre and were traveling down the Seine when he got the call. He asked her to take a picture with her phone to capture the milestone. It was an appropriate way for a mobile-first travel mogul to close such a pivotal deal.

What’s cool about Hotel Tonight potentially budding into the next $1 billion-plus travel company: It’s executing the exact opposite playbook of the rest of them. Indeed, the company was originally incubated inside of Kayak-competitor DealBase, but Shank (wisely) decided it needed to be built independently from the ground up and as far away as possible from any existing online travel site.

It’s insanely simple, showing the user just a few curated hotels available that night. It has been a pioneer in one-click check-out, powered by Braintree, just like Uber and Fab. Hotel Tonight doesn’t try to be everything to everyone. It doesn’t even try to be everything to all hotel shoppers. There’s a lot you can’t do on it. Welcome to Travel 2.0: The age of design, experience, and curation. No more mind-numbing matrices.

Sure bigger rivals like Booking.com are waking up to the idea that last minute hotels are a sizable 15 percent of the category and launching competing apps. But because they are coming from a world of infinite inventory and a stodgy desktop experience they aren’t showing you a curated mix of three to five excellent hotels you can book with just a few swipes of the finger. They are showing you hundreds of listings that would be horrible to scroll through on a computer, much less your phone. They fundamentally don’t get that in a mobile world less is more. It’s not what Hotel Tonight does that is its secret sauce, it’s the way it does it.

A well-designed app aside, why do I keep imitating that Hotel Tonight could — maybe, maybe, maybe — have the chops to make it as a stand alone public company? Because of who the lead investor in this round is: Coatue Management.

Coatue is backed by Philippe and Thomas Laffont — a duo of hedge fund brothers who decided to start investing in late stage private companies, setting up shop earlier this year amid the VCs on Sand Hill Road. As we reported first back in February, the two are trying to be a different player in the growth arena: One that brings the rigor, research, and mindset of a hedge fund to private companies.

That may sound repugnant to those Valley entrepreneurs who vomit in their mouth a little bit and think “Carl Ichan” and “Dan Loeb” when they hear the word “hedge fund.” But that’s kinda the point.

As Bill Gurley so eloquently put it at our July PandoMonthly building a company without accepting best case scenario you’ve gotta go public is like dreaming a whole career of being a pro-basketball player and then getting cold feet about the pressures of having your performance dissected on ESPN everynight.

Put another way: If the “goal” is to go public within five years, Coatue can train you in how a hedge fund thinks before your life as a public company depends on it. (See also: Facebook’s debacle of an IPO.)

As we reported in February, Coatue invested in Box’s last funding round before its fund was totally closed. But Hotel Tonight is the first deal the firm has lead out of its $375 million fund.

No offense, but, Hotel Tonight?

Twitter, Box, Airbnb, Dropbox — sure. Hotel Tonight has been on no shortlist of big potential IPO candidates I’ve seen. If you’d asked me what hot, surging, pre-IPO growth company Coatue would back first, I would never have guessed Hotel Tonight. And I’m a regular user of the app who has always been a bull on the company.

Hotel Tonight has suffered the knocks that it’s an easily replicable gimmick and a site that people just use to facilitate one-night stands. Indeed, many of the Web 1.0 travel era have also instituted features for booking last minute rooms.

But those knocks are similar to the old saws that Facebook was just for college kids, and Snapchat is just for sexting. Netflix, too, was a company that everyone thought Blockbuster could easily replicate. That turned out to be harder than it seemed.

I caught up with Daniel Senft, senior managing director at Coatue Management and asked him whether I misunderstood Coatue’s investing strategy, or whether Hotel Tonight was just doing far better than anyone thought. The answer is partially the latter, but the investment also speaks to how well Coatue thinks Hotel Tonight can do with another big injection of cash, well enough that it can be the next multi-billion independent travel franchise, Senft says.

Coatue did very different due diligence that any of Hotel Tonight’s other investors ever have, says Shank. The Laffont brothers have been heavy shareholders in companies like TripAdvisor and Priceline. And Senft was at Blackstone previously and worked on the original Orbitz deal way back in the day. As a team, they know the category well and have profited from it massively.

When they ran their own analysis on Hotel Tonight’s business they saw a company that looked better than even Shank realized. “They shared it with us and were like ‘Here’s what we like about you and here’s what you should know about yourself,'” Shank says. “We were flabbergasted and floored.”

Among the data points were how mobile-centric all travel is getting. Travelocity, for instance, has four times the mobile downloads of Hotel Tonight for a far inferior experience. “There is no good reason for that,” Senft says.

And when Coatue went through ten cities and compared hotels on other sites with those on Hotel Tonight, they found very little overlap — just 45 percent. Where they did overlap, the hotels that were listed on Hotel Tonight offered 20 percent cheaper rates on average. Actual differentiated inventory is rare in the online travel world. And it makes sense because Hotel Tonight’s core strength is optimizing for one thing. That means there’s no channel conflict. Booking.com, by contrast, wouldn’t want to push 20 percent cheaper last minute deals, because it would cannibalize the rest of its hotel booking business.

Additionally, there are 14,000 hotels listed online in the US and just 1,800 that have ever been on Hotel Tonight. That means there’s a lot more hotels the company can expand to. Not that it should ever flood its listings. Like all other mobile commerce, it’s about curation and personalization and showing the user the deal they are most likely to want. “The more inventory you have the better chance you can match the user with exactly what he or she is looking for,” Senft says.

Anyway you slice it, there’s a lot of room for major growth here, Senft says. Last minute bookings are now 15 percent of the market, and Senft thinks the right app can expand that market dramatically, the way Uber expanded how many people take black cars and limos. And if Hotel Tonight shimmies just a bit into booking a trip a few days before you travel, it can expand that number dramatically while still staying focused, clean, and curated.

Right now, Hotel Tonight is growing 300 percent year over year in bookings “off of a large base,” says Shank. It has more than 6.5 million downloads and some 3,000 partner hotels in pockets around the world.

Still, Hotel Tonight has a long way to go before it could go public. Like other location-centric companies like Yelp, OpenTable, or Uber, launching and getting good inventory in new cities takes work. This $45 million will be used for further geographic expansion and filling in areas between cities.

Of course, whether Hotel Tonight has the business to support an IPO is one question. The other question is around ambition. We’ve written at length about the modern day entrepreneur’s frustration with public company life, the view that it’s a “necessary evil” of starting a company — and how that jaded view doesn’t exactly excite potential public investors.

Sam Shank may be building a very modern mobile-first company, but in this regard he’s decidedly old school. Like those entrepreneurs roaming the Valley in the late 1990s, he has a clear goal: Ringing the opening bell the day his company goes public. He told Senft as much one of the first times he met with them. “My dream was to have a public company by the time I was 40 and the problem is I’m turning 40 in one week so that’s not going to happen,” Senft recalls Shank saying. “But maybe because of Sarbanes Oxley I can get a break and extend it to the time I’m 45.”

Clearly, Senft added, this is a guy with big ambitions.

[Illustration by Hallie Bateman for Pandodaily]

(Disclosure: Accel and SV Angel are investors in both Hotel Tonight and PandoDaily. First Round is also an investor in HotelTonight and First Round’s Josh Kopelman is an investor in PandoDaily as well. As always, our entire list of investors is found in our launch post on our about page.)

Sarah Lacy is the founder and editor-in-chief of PandoDaily.
She is an award winning journalist and author of two critically acclaimed books, "Once You're Lucky, Twice You're Good: The Rebirth of Silicon Valley and the Rise of Web 2.0" (Gotham Books, May 2008) and "Brilliant, Crazy, Cocky: How the Top 1% of Entrepreneurs Profit from Global Chaos" (Wiley, February 2011).
She has been covering technology news for over 15 years, most recently as a senior editor for TechCrunch.

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